Skip to main content
Practical manual for Income Tax 2023.

Joint limit of deductions of articles 35, 36 and 38 LIS in the Canary Islands

  • General Joint Limit: 60 percent or 90 percent

    In accordance with article 94.1.b) of Law 20/1991, of June 7, 1991, the joint limit on the quota will always be 80 percent higher than that set in the general regime, with a minimum differential of 35 percentage points.

    Therefore, the joint limits of article 39.1 LIS are raised to 60 percent or 90 percent

    Consequently, the deductions for investments of articles 35, 36 and 38 LIS , applied in the Canary Islands in the tax period, may not jointly exceed 60 percent of the quota resulting from reducing the sum of the full, state and autonomous quotas (boxes [0545] and [0546] of the declaration), in the total amount of the deductions for investment in habitual housing (in the case of taxpayers to whom the transitional regime of this deduction is applicable), for investment in new or recently created companies, provided for in article 68.1 of the Personal Income Tax Law , and for actions for the protection and dissemination of the Spanish Historical Heritage and World Heritage (∑ boxes [0547] and [0548] ; boxes [0549]; [0550] and [0551], respectively).

    However, it will be raised to when the amount of the deductions under Articles 35 and 36 exceeds 10% of the aforementioned rate.

    Note: The deduction limits of article 94.1.b) of Law 20/1991 apply to the deduction of article 38 of the LIS , since article 26 of Law 61/ 1978 contained, in section six, a deduction for disabled workers at the time of its repeal. Therefore, this deduction will be subject to the joint limit of 60/90 or 70/100 (La Palma, La Gomera and El Hierro).

  • Joint boundary for the islands of La Palma, La Gomera and El Hierro: 70 percent or 100 percent

    As of 2019, for the islands of La Palma, La Gomera and El Hierro, the minimum limit of 80% will be increased to 100% and the minimum differential will be 45 percentage points when the Community regulations on State aid so permit and the investments are provided for in Law 2/2016, of 27 September, and other laws on measures to regulate the economic activity of these islands in accordance with the provisions of article 1.Forty-one of Law 8/2018, of 5 November, which modifies Law 19/1994, of 6 July, amending the Economic and Fiscal Regime of the Canary Islands ( BOE of 6 July). Consequently, in these cases, for the islands of La Palma, La Gomera and El Hierro the joint limits (60% or 90%) are raised, respectively, to 70% and 100% .

    The application of the limits provided for the islands of La Palma, La Gomera and El Hierro in those cases in which the taxpayer also generates deductions in other territories of the Canary Islands must simultaneously comply with the following rules:

    1. Deductions generated on the islands of La Palma, La Gomera and El Hierro must respect their own enhanced limit (70/100 percent). Likewise, the deductions generated in the rest of the Canary Islands must also respect their own improved limit (60/90 percent).

    2. In the event that there are both deductions on the three islands mentioned (La Palma, La Gomera and El Hierro) and on the rest of the Canary Islands, the maximum limit for both types of deductions will be the higher one, that is, the improved limit for the three islands (70/100 percent).

    3. In the event that deductions apply on the three islands mentioned and on the rest of the Canary Islands, the latter will not be able to benefit from the increased limit of the three islands.

  • Application of the joint limit

    Finally, note that this joint limit on the quota is independent of that corresponding to investments covered by the General Regime of deductions of the LIS and the Regimes of support for events of exceptional public interest included in Annexes A.3 and A.4 of the declaration.